The Warrington-based company has made the "one-off" application to water watchdog Ofwat to tackle soaring costs, including rising charges from chasing customer debts.

Water companies are forbidden from cutting off supplies to customers who do not pay their bills.

Debt has increased and the problem is believed to be caused by customers who will not pay their bills rather than those who cannot pay.

United Utilities spokesman John Carberry said: "We've applied for the increase for two reasons.

"Construction cost inflation has risen faster than anticipated and the impact of debt since water companies were prevented from disconnecting customers for non-payment in 1999 has also led to a loss of revenue and extra costs."

He added: "We know that any price rises will be unpopular with our customers.

"At this stage we're unable to give an indication as to what, if any, impact our application will have on our proposed price increase for 2004/05.

"Once we receive Ofwat's draft response to our submission in November, then we will be in a better situation to discuss specific price increases with our customers."